It Is Customary for New Car Dealers to Clean and Check

question 384

Multiple Choice

It is customary for new car dealers to clean and check new cars prior to delivery to customers. Danver Chevrolet fails to do those checks before delivering a new car to a buyer. A check would have revealed that the exhaust was going into the passenger compartment. While driving, the buyer is overcome by carbon monoxide and crashes.

• A) if the buyer can demonstrate "actual reliance" on the seller's expertise, the dealer may be held liable for a breach of an implied warranty of merchantability
• B) the dealer may be liable to a buyer for damages under a breach of an implied warranty arising from trade usage
• C) the dealer may be liable to a buyer for damages for breach of an implied warranty arising from merchantability
• D) since the new car was under warranty, the seller has the right to cure the problem in a reasonable manner
• E) the dealer cannot be held liable; the problem is with the manufacturer

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Definitions:

Cost Of Goods Manufactured

The total production cost (material, labor, and overhead) of goods completed and transferred out of the work-in-process account during a period.

Internal Reports

Financial and operational reports used internally by a company's management and staff to make decisions; not distributed outside the organization.

Aggregated

Combined or summed up into a whole; used often in the context of data or information that is collected from different sources and presented as a total.

Detailed

Characterized by a presentation of in-depth information and specifics.